P.8 Message from the President (4)

Message from the President

Message from the President What lies beyond our three challenges Global, content IP, and EduTainment. These are not indepen- dent businesses. Taking on the world means expanding the value of Japan. Developing IP means nurturing culture that will be carried forward into the future. Engaging in education means fostering the people who will shape the future. All of these are rooted in my management philosophy of believing in people and creating the future. We are not simply creating content. We are shaping the future. Taking on the world, creating new IP, and transforming the way children learn are all challenges aimed at shaping a richer future for Japan. My goal is to transform the Group from a “company that moves people’s hearts” into a “company that moves the future.” We will continue to drive this transforma- tion forward with determination.

Trust is the capital underpinning our corporate value

A company cannot grow on aspirations alone. Nor can it build the future solely by taking on challenges. I believe corporate value is generated only when we combine the ability to envi- sion the future with the discipline to steadily turn that vision into reality. That is why I regard dialogue with the capital mar- kets as one of the most critical management responsibilities. As a corporate leader, I take the market’s current valuation of the TBS Group very seriously. We have content with global reach, a diverse business foundation, and creativity cultivated over many years. Yet I do not believe that their full potential is reflected in our corporate value. That is why we will actively engage with the market. Is our strategy truly connected to the future? Are our growth investments generating value that exceeds the cost of capital? Are our initiatives translating into results? Our ROIC*-based capital policy embodies this approach. ROIC is not simply a financial metric. Where should we deploy our limited management resources? What value will that investment generate five or ten years from now? ROIC is a “management discipline” for reassessing every management decision from both the perspective of investing in the future and of capital efficiency. This summer, I visited London and engaged in candid discussions with institutional investors from around the world. What I heard were not words of encouragement, but tough questions born of high expectations. Their message was clear: “We support the strategy of transforming the company from a broadcaster. However, we can only make investment decisions once growth investments translate into earnings and their re- sults are demonstrated in numbers.” “The more an investment is aimed at the future, the more clearly you should show how the funds will be used and what returns they are expected to generate, together with clear targets.” These words made a deep impression on me. The world believes in the potential of the TBS Group. Yet, for now, all we can offer in response to those expectations is a promise of what lies ahead. What the capital markets are looking for is not sim- ply a compelling narrative, but the “results” to back it up. Only when those results materialize as earnings and are reflected in the numbers will expectations turn into unwavering trust. That is why we will not rely on words alone to communicate our strategy. Our commitment to the capital markets is to continue to demonstrate, through tangible results and numbers, that the future we envision is becoming a reality. At the same time, corporate value is not determined by financial capital alone. A corporate culture that nurtures people. A culture that empowers people to take on challenges. Creators who take on the world. Creativity that generates new value. Re - lationships of trust with society. These intangible assets are the very sources of long-term corporate value. That is why I will spare no investment in people. I will never stop investing in creativity. And I will not hesitate to invest in the future. Attracting talented people and empowering them to take on challenges. Remaining a company trusted by society. Upholding highly transparent governance. The accumulation of these efforts underpins our medium- to long-term corporate value. I believe management is the “work of building trust.” We must remain a company trusted by all our stakeholders—our shareholders and investors, viewers, listeners, users, business partners, local communities, and each and every employee who will shape the future with us. The trust we build over time becomes corporate value and gives us the strength to take on new challenges. And we will continue to present those results to the capital markets with integrity. That is the management commitment we make to our shareholders and investors. * ROIC: Return on Invested Capital. A metric indicating how much profit is generated from the capital invested in business activities.

A place where creativity emerges:

Transforming Akasaka into “AKASAKA,” a global hub for creativity

Great content is never the product of a single talent. People with different perspectives come together, inspire one another, and generate new ideas. Over time, these interactions have produced works and cultures that have shaped society. That is why I believe creating an environment where creativity can flourish is one of the key responsibilities of management. For more than 70 years, the TBS Group has been based in Akasaka, creating countless programs and new cultures. I am not satisfied with simply continuing to develop this town as a “neighborhood with a broadcasting station.” I want to trans- form it into a creative hub where talent gathers from around the world, new challenges begin, and new cultures take root. Driven by this vision, we are advancing the “Akasaka Entertainment 08